Nokia Research Center, Beijing has just released Nokia Diexie, a beta application for Chinese speakers around the world to write sentences in Chinese on their touchscreen phones naturally, without having to pause between characters. Here is more info along with a video:

What makes Nokia Diexie unique is that it was designed specifically for smaller touchscreen phones where writing out a full sentence just won?t fit on the limited real estate. Nokia Diexie allows users to simply write a full sentence one character over another in a stacking style. As you begin writing the next character over the previous character, the previous character begins to fade away, creating an overlapped visual, allowing you to concentrate on finishing the next character.

Nokia Diexie is an evolutionary iteration of the handwriting recognition technologies that were previously showcased in the Ovi Store with Nokia Handwriting Calculator and Nokia Continuous Handwriting Input.